The benchmark Nikkei-225 index lost 1.11 percent to 229.38 points to 20,455.44 yen, while the broader Topix index fell 1.15 percent or 17.27 points to 1,486.57.

The Tokyo market's fall came after investors sold down New York shares overnight, with the Dow giving up 1.5 percent on lingering worries over the US-China trade war.

Investors are still trying to digest US President Donald Trump's suggestion on Friday that he was prepared to walk away from high-level trade talks with China expected in September, analysts said.

Asian investors also dumped shares as increasingly violent protests in Hong Kong resulted in the cancellation of hundreds of flights in and out of the financial hub, with the overall unrest showing no clear signs of ending.

Hong Kong stocks tumbled, as did the Shanghai market.

"The Nikkei came under pressure early with uncertainty over the trade issue between the US and China as well as the disruption in Hong Kong," Okasan Online Securities said in a memo to clients.

The dollar's relative weakness continued, buying 105.28 yen in Asian trade, flat from New York late Monday.

The US currency's fall, or the yen's rise, hurts Japanese exporters by making their products relatively more expensive overseas.

"Many players want to wait and see the directions of US shares and bond yields," Okasan said.

Many Tokyo investors were away from the market for the traditional "Obon" summer holidays.

Among major shares in Tokyo, Toyota lost 0.69 percent to 6,790 yen and Sony fell 1.41 percent to 5,889 yen.

Nintendo plunged 2.61 percent to 38,410 yen. Mitsubishi UFJ Financial Group fell 1.12 percent to 504.2 yen.